Full Court of the Family Court Dismisses Appeal: Confirms Married Man and Former Sex Worker were in a De Facto Relationship for 18 months

Background

In the recent case of Sha & Cham [2017] FamCAFC 161 (16 August 2017) the Full Court of the Family Court of Australia (Bryant CJ, Ainslie-Wallace & Cronin JJ) heard Mr Sha’s appeal against the primary judge (Johnston J)’s finding that he had been in a de facto relationship with Ms Cham from March 2012 until September 2013. In late 2011, the appellant (who lived with his wife Ms B) met Ms Cham in a massage parlour where she worked. In late February or early March 2012 the parties began a sexual relationship. In mid-March 2012 they discussed having a baby together and Ms Cham stopped working at the massage parlour at Mr Sha’s request. They began seeing each other at Ms Cham’s home where Mr Sha occasionally stayed overnight.

Mr Sha paid $2,000 per month towards Ms Cham’s mortgage from April 2012 and gave her $28,000 by instalments in June, July and September 2012. They also made a Financial Agreement pursuant to section 90UC of the Family Law Act 1975 (Cth) (the “Act”) (an Agreement during the course of a de facto relationship as to what would happen with the parties’ property in the event of a relationship breakdown). Ms Cham became pregnant to the appellant by means of IVF treatment in September 2012; Mr Sha and his wife (Ms B) separated in October 2012; and the parties had a child together in mid-2013. By November 2013, Ms Cham signed a separation declaration, which triggered the operation of their section 90UC Financial Agreement.

** Mr Sha argued on appeal that the court at first instance erred when finding that the parties were in a de facto relationship from the time of signing Financial Agreement.

Full Court Analysis

In determining whether two people have a relationship as a couple living together on a genuine domestic basis, the Full Court of the Family Court stated that regard is to be had to all of the circumstances of their relationship, which may include the matters to which s 4AA of the Act refers (this section outlines the common indicators of what gives rise to a de facto relationship). Whether such a relationship exists will depend on an assessment of all of the circumstances of the relationship, each circumstance to be given such weight as the court considers appropriate.

The Full Court focused its attention on the section 4AA indicators below:

Common Residence

As to common residence, the parties advanced different accounts of the frequency with which the appellant stayed overnight at the respondent’s house, although it was undisputed that he did so. The primary judge concluded that, although a precise position was unable to be reached on the evidence, it was likely that the times on which appellant stayed overnight at the respondent’s house were ‘regular and significant’.

In all the circumstances, the Court was drawn to the finding that it was more probable than not that the [appellant] spent considerable time each week at the [respondent’s] home including spending time overnight there regularly but I am unable to quantify the time so spent.’

His Honour noted the argument that because neither the appellant nor respondent referred to the appellant’s time spent at her house as ‘living there’, he would not find a common residence, and concluded:

The view of the Court was that the parties did have a common residence and this was at the [respondent’s] home, albeit for relatively confined periods of time.

Commitment to a Shared Life

As to a commitment to a shared life, his Honour found that a ‘regular and constant feature of the parties’ relationship’ was the appellant’s assurances to the respondent that he wished for them to have a child and his assurance that he would provide the respondent and their future child with financial support.

The Full Court found that the appellant entering into the financial agreement reflected that commitment. The Court further stated that the respondent showed a commitment to a shared life with the [appellant] in the sense that she accepted his assurances about supported her and the child, gave up her employment as a sex worker and committed herself to endeavouring to have his child under the IVF program.

The Full Court rejected the argument advanced for the appellant that he did not share in the respondent’s desire for a shared life because he, despite the respondent’s requests, did not appear to want to divorce his wife. The Court considered a letter between the parties and the terms of endearment there used. It was found that although there was some dispute as to the level of affection conveyed in the terms used, the appellant conceded that he referred to the respondent as ‘My wife’ and referred to himself as ‘Your Husband’ in the letter.

Financial Agreement

At first instance, the primary judge noted that while the parties’ relationship had not been registered under a prescribed law of a state or territory (s 4AA(2)(g)) the Financial Agreement was ‘very significant’ to the determination of the issue of the nature of the parties’ relationship.

The primary judge noted that the recitals to the Agreement asserted that the parties were in a de facto relationship. Although the appellant contended at trial that he did not understand the nature of the Agreement, the primary judge rejected that assertion. He found that there had been discussions between the parties as to the details to be inserted into the agreement prior to its signing; that the appellant was advised as to the nature and effect of the agreement by a solicitor and that advice was translated into Cantonese; that this was not the first time that the appellant had entered into a written legal agreement; and that before he signed the agreement the appellant had received a letter of advice from the solicitor which contained the details to be included in the agreement, including the fact of the parties having been in a de facto relationship for four months.

These findings were not disturbed on appeal.

Section 4AA(2) Criteria

At first instance, the primary judge did not conclude the discussion of each s 4AA(2) criterion with a finding as to whether it supported or spoke against the parties living together as a couple on a genuine domestic basis. I was found that each aspect of the relationship was to be looked at in the context of the relationship as a whole. Thus, a finding as to common residence may support the existence of a de facto relationship when considered along with other factors, although it may not standing alone. There was no error then by the primary judge for not concluding each consideration of the s 4AA(2) factors with such a finding, as this ultimate finding was reached upon consideration of the factors as a whole.

Full Court Conclusion

The Full Court stated that there was no requirement in the Act that a court in applying s 4AA of the Act is required to carry out a specific evaluation and/or weighing up for the factors in favour of and against a finding of a de facto relationship. Indeed s 4AA(3) may well suggest to the contrary.

In the case of Lynam, the Court stated that each element of a relationship draws its colour and its significance from the other elements, some of which may point in one direction and some in the other. What must be looked at is the composite picture. Any attempt to isolate individual factors and to attribute to them relative degrees of materiality or importance involves a denial of common experience and will almost inevitably be productive of error. The endless scope for differences in human attitudes and activities means that there will be an almost infinite variety of combinations of circumstances which may fall for consideration. In any particular case, it will be a question of fact and degree, a jury question, whether a relationship between two unrelated persons of the opposite sex meets the statutory test.

In any event, the primary judge did indeed consider and evaluate the evidence, made findings of fact and stepped back and considered the totality of that evidence and, in effect, weighed up and balanced the matters to which he had referred.
Orders

The Full Court did vary Johnston J’s declaration by substituting “as at 3 August 2012” (the date of the parties’ Financial Agreement) for the dates when a de facto relationship was found to have existed, but otherwise dismissed the appeal with costs.

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